Currencies
- The euro (EUR) continues its bearish trend against the US dollar (USD), reaching a new 9-month low at 1.3302. The single currency continues to be under pressure as the European PMI will be announced tomorrow and FOMC meeting minutes are released this evening.
- The US dollar (USD) rose against the Japanese yen (JPY) to 103.16. The greenback climbed to a 4-month high as the US Building Permits and Housing Starts were better than expected at 1.05M and 1.09M, while the expected Building Permits and Housing Starts were at 1.00M and 0.97M. The US economy shows signs of recovery, while later investors look ahead to FOMC Meeting Minutes about the projections of the US economy, with speculations of raising the interest rates increasing.
Equities
- The US equities rose yesterday as the US economy recovers faster. The US 500 (SPI) advanced to 1975, the US 30 (DOW) climbed to 16873 and the US Tech (NDQ) went to 4032.
Commodities
- WTI Crude (OIL) fell to an 8-month low at 92.83 USD per barrel ahead of the Crude Oil Inventories later today. The inventories are expected to shrink by 1.3M barrels.
Mover & Shaker with forex options
- The British Pound (GBP) dropped to a 4-month low against the USD dollar (USD) at 1.6605 as the yearly UK CPI came out to be worse than expected at 1.6%, while the expected inflation data were at 1.8%. Today the Monetary Policy Committee of Bank of England’s will vote for the Interest Rate and for the Asset Purchase Facility, with possibilities of increasing interest rates lower.
- Option traders may consider constructing a Back Spread Strategy with Puts on the GBPUSD and gain if the pair moves lower, while the risk is limited to the premium paid.
- A Back Spread Strategy with Puts can be constructed by selling an at the money Put while buying an out of the money Put at double amount.
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EUR/USD edges lower toward 1.0700 post-US PCE
EUR/USD stays under modest bearish pressure but manages to hold above 1.0700 in the American session on Friday. The US Dollar (USD) gathers strength against its rivals after the stronger-than-forecast PCE inflation data, not allowing the pair to gain traction.
GBP/USD retreats to 1.2500 on renewed USD strength
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